On income inequality in America, this comes from Scott Winship:
Only 13 percent of children starting in the bottom fifth [of income] will end up in the top two-fifths in adulthood (compared with 63 percent of children who start out in the top two-fifths).
What conclusions should be drawn from this? There are lots of possibilities:
- The genetic fruit doesn’t fall far from the tree. In today’s economy, self mastery and intelligence determines your value as an entrepreneur or employee. The rich are rich because their temperaments and intelligence match the work to be done, and they’re rewarded accordingly. Rich kids inherit the temperament and intelligence genes of their rich parents (not just their money), and it’s those genes that largely determine life’s outcomes. The opposite dynamic is obviously working (unfavorably) in poor children.
- Biology has nothing to do with it. Each human is a lone island with free will, a rugged and Romantic individual. How you end up is no fault of your biology or society. 13% of poor children claw their way into the top 40% when they reach adulthood. That’s not a terrible number. It suggests it can be done. If you’re a poor kid, be in that 13%. It’s all on you.
- No man is an island (left). This is the social structuralist explanation. The reason the poor are poor and the rich are rich is because we’ve collectively structured society in an unequal manner. Shame on us. Level the playing field in various ways (early childhood education programs, etc.) and poor children can start to perform as well as rich children.
- No man is an island (right). The poor are poor because of culture. They don’t go to church at the same rates as the rich. They don’t stay married. These are the kinds of structural elements surrounding poverty that government can’t address.
- Nudge the needle. All of the above have some element of truth to them. Each is a contributing factor as to why the rich are rich and the poor are poor. We can do some things to change outcomes, but there are factors at work in the rich-poor dynamic that are beyond our direct and collective control. Keep trying things, but no guilt if they don’t work.
- Give up. Whatever the reasons, the poor will always be with us. Jesus said that. Go back to reading your Nietzsche and Ayn Rand and get on with your life. Maybe your own productivity will inadvertently help the poor downstream. And you can give to charity if you want. In any case, it’s largely out of your hands. Be happy. Vote Republican.
I’m in the “nudge the needle” camp. How about you? And is there a plausible conclusion that, in my blinkered liberalism, I’ve missed?
Prometheus Unbound 
One interesting thing about the nudging the needle is that the more equal opportunity, the more biological differences will prevail. In Sweden this has led to some uncomfortable truths as 90 percent of the engineers are men in one of the most gender equal societies in the world.
I agree that there’s a bit of a catch-22 in giving people a hand up (as opposed to a handout). If they don’t take the hand or the hand up doesn’t help, then it falls back on the one getting helped (that there’s something wrong with them or fundamentally different about them). If women in Sweden are given every opportunity to succeed at engineering and blow it off, it seems to narrow the explanations as to why (though these explanations may not be just biological).
At some level, in other words, help can function perversely as a refined form of cruelty, generating self doubt in those helped.
–Santi
You have left out at least one theory. Tell a group of kids that they are constantly being discriminated against, that it is them against the world. Tell them that the cops hate them and want nothing more than to harass them and throw them in jail. Tell them that rich people get all the breaks and oppress them at every opportunity. Tell them that they need symathetic white people to give them advantages in getting into college and getting a job. Tell them to rebel against the system and never to submit to the man. Nurture hate and resentment. Oh sorry, I’ve described the Democratic Party’s political strategy. Works pretty well for Democrats and pretty dismally for the poor.
“Tell a group of kids that they are constantly being discriminated against,”
which just might be not only factually true but also painfully obvious to them, whether anyone bothers to ‘tell them” or not,
…“that it is them against the world.
also, it so happens, the apparent operative assumption of the take-no-prisoners world of top corporate management, schooled in elite international business programs. What a concept!, huh? So, of course, if the cut-throat executives can just convince a portion of the brutalized and the burdened beneath them to believe in the fairy-tale that “it isn’t you against the world”, then so much the better for the cut-throat exectutives whose tasks are lightened by that degree. Now, just imagine that we lived in a world in which the poorest and the most disadvantaged not only believed but acted on the fact that, indeed, it is the “world” (i.e. the richest and most powerful) arrayed against them –and everyone else who is or who would be, the devoted allies of these poor and disadvantaged. That’s not a picture that the Davos World Forum crowd would like to see come to pass. And so, immense social and communications media forces are martialled and used to help ensure that it doesn’t come to pass. In that effort, the world of science and of scientists, weighs in heavily on the side of power and wealth, not on the side of the poor and the disadvantaged.
Tell them that the cops hate them and want nothing more than to harass them and throw them in jail.
Really, it doesn’t matter if “most cops” don’t actually want to do (or not do) such things. What counts really is simply that there’s a cop who’s quite content to see and act accordingly, and that that cop is in the view of and the way of the “kid”, ready to, indeed, throw him in jail. Again, do poor kids really need these things to be pointed out to them by “their betters”?
Tell them that rich people get all the breaks and oppress them at every opportunity.
“Get all the breaks”? That makes it all sound so perfectly innocent and accidental. (Nature’s blind operations are innocent and accidental. But those of the rich and powerful aren’t. ) As though those helpful “breaks” aren’t helped along by the rich people’s thumb on the scale?!?!
Tell them that they need symathetic white people to give them advantages in getting into college and getting a job.
True at least in this respect: today, unlike over the course of many generations past, a Black or other skin-toned person in the right position of influence could do just as well as a “White person” in giving a useful advantage in getting into college. It’s just that, alas, unlike over the course of many generations past, getting into college today is not the fairly guaranteed meal-ticket and ride to success that it used to be. (But, sshhhhh. Don’t tell those kids that brazen truth, either, right?)
Tell them to rebel against the system and never to submit to the man.
Nurture hate and resentment.
F***ing hilarious. Which segment of society hires, trains, equips and keeps at the constantly-ready forces with armored vehicles, truncheons, shields, helmets, body-protecting armor, fire-arms both semi-automatic and automatic, and tear-gas, helicopters, water-canons, taser-arms, and attack-dogs?—and which segment doesn’t heistate to deploy and loose these forces on those who’d dare to exercise their basic civil rights to assemble and to protest? hmmmm? Which? Does that phalanx of power describe the ghetto youth? Or does it describe (as above) the people who constitute “the system” and “the man”?
Oh my!, dear me! If we really aren’t more careful, the poor and disadvantaged might get the right–ooops, excuse me, the wrong idea about the kind intentions of those in power over them.
Oh sorry, I’ve described the pseudo-two-party-Republico/Democratic ‘Party’s’ political strategy.
Why do I get the strange notion that you are an Occupy type? I described the type of indocrination that results in a lifetime of frustration and poverty. You described the syllabus for a class in social justice.
An appalling ignorace of science facilitates countless stupidities in people’s notions about how the world works–even when their own personal experiences contradict the socially-reinforced assumptions with which privately-owned mass-media bombard us day in and day out.
If more people had a basic or better grasp of biology, they’d understand better some things about what they already experience but allow themselves–for reasons of social expediency–to ignore or discount: yes, while it’s generally true that the “genetic fruit (on average) doesn’t fall far from the tree,” and while this should reasonably have some bearing on the observed discrepancies in “success rates” among various social strata, the fact is that the social strata are also preemptorily and heavily influenced by the social advantages (or disadvantages, as the case may be) that are there and at work long before anyone’s genetic heritage “intervenes.”
Successful parents’ social connections and other advantages offer their children a leg up on those of their peers whose parents don’t enjoy the same connections and other advantages. That fact swamps other factors such as (the quite variable) outcomes in inherited traits, skills, talents, which endow children with some of their parents’ strengths (and, let’s not forget, weaknesses, too). All other things being, if not “equal,” then at least comparable, a child’s social and economic prospects are better if his or her parent is a senior executive in a Fortune 500 multinational, quite apart from whether the child’s own natural endowments are average or exceptional. But that picture runs counter to the national mythology of earned success, of rewards distributed according to merit. No one understands the bogus character of such silly mythology better than the people in the top 1/100th of 1%—they do what they can –and it’s considerable–to ensure that their children benefit to the fullest degree possible from the advantages these children come into by birth, by being born into a family already at or near the top.
The statistic cited –> “Only 13 percent of children starting in the bottom fifth [of income] will end up in the top two-fifths in adulthood (compared with 63 percent of children who start out in the top two-fifths)” means something, yes. But the point is neither of the two absurd extremes–namely, that biology (chromosomal inheritance) explains everything, or, on the other hand, that it has no part at all. Of course it has a part. But its role is distributed over whole populations and appears in the form of averages, greater or lesser probabilities of X, Y or Z to occur. When it comes to individuals, rather than population averages, its your parents’ whole-picture that counts, not merely their genetic make-up.
But our general knowledge of science and our general capacties to reason effectively and to handle statistical data are so dismal that the data sits there, unappreciated, waved away with stupid and groundless rationales offered in refutation. And that explains much about how and why so many people are so astonishingly stupid in their conceptions of the part which random chance plays (hint: it is ENORMOUS) in outcomes, from the profound to the trivial.
For example: those who unreflectively believe, who blindly accept as given, that “markets are aggregates of rational actors, each seeking his or her own rational enlightened (or unenlightened) interests” and that, therefore, “markets are rational,”—such people are both statistical morons and a social-history morons. Yet, such, it appears, is standard MBA management and marketing orthodoxy.
A astute grasp of the real implications of scientific knowledge would, if current among a large majority of the general public, have profound consequences because they might lead people to recognize the following two cardinal facts of nature:
1) Everything in nature, everything, without exception, from subatomic particles to the limits of space-time on a universal scale, is in constant motion and evolution, a ceaseless process.
and,
2) that motion, that constantly-evolving change, is undirected, unplanned, and the outcome of probablisitc averages, themselves a feature of blind random chance.
Those are the key insights which four hundred years of scientific progress have produced for us; but these insights, which would revolutionize people’s world-views if only they grasped them, are, too commonly, simply lost on vast portions of the general public and, indeed, even lost on a shockingly large number of scientists themselves.
That video is helpful. What I hear him saying is that the poor are skewed young, but then my question is this: why does the data of Winship that I started this post with indicate that most of the poor in the end pretty much stay out of the top 40% their whole lives?
It would be interesting to know where the poor distribute in total over the course of their lives. A poor child at ten is where at thirty and sixty?
–Santi
Helpful? How is it helpful? How is it even accurate?
Have a look here to see who are behind that load of baloney—-
“Institute for Humane Studies”
@ Wikipedia, see: “Organization and funding” and guess!: whose names appear there?
http://en.wikipedia.org/wiki/Institute_for_Humane_Studies#Organization_and_funding
Proximity,
You’re attacking “the man” rather than the data. Libertarian think tanks funded by right wing billionaires will obviously put a libertarian spin on data, but that doesn’t mean that one should dismiss their analysis out of hand. One thing (obviously) to emphasize in poverty statistics is the young. It’s not unhelpful to highlight it and discuss it.
It comes down to trust verses suspicion, doesn’t it? I take it for granted that all sides in a political dispute will mix propaganda with data highlighting. But that doesn’t mean you refuse to look at potential disconfirming evidence of your own biases on the grounds that it comes from politically motivated people.
–Santi
If you belive the silly nonsense that AndrewClunn is peddling there, then I have a hunch you thought Herman Cain was a great candidate for president of the United States. In that case, you’re right in the midst of that cohort I referred to above–
“countless stupidities in people’s notions about how the world works–even when their own personal experiences contradict the socially-reinforced assumptions with which privately-owned mass-media bombard us day in and day out.”
RE: Santi Tafarella says:
March 9, 2013 at 7:25 pm
Not at all. I’m attacking the data and indicating that the source of the video provides a clear rational explanation for why this screwy data is offered: it’s a case of pure class-driven self-interest which, in this case, is simply a load of falsehoods.
If the data had been valid, I’d have had no occasion to investigate who & what was behind the post. Since, to those who are even moderately aware of the facts of income distribution and relative wealth-holdings among various social strata, the claims made in the video are ridiculous, I was prompted to look into who’d be interested in posting such malarky. You see, at that point, I really didn’t know who it was. When I checked, the actual facts supported my prior hunch. It turned out that the posted video is the work of a “libertarian” think-tank. That, by itself, didn’t and doesn’t mean that the data and claims are spurious; they are, though, whoever it had proved was behind them.
Watching the video carefully, one sees that the data cited, even if true, date from 1997. The year of the onset of the current lingering depression. Further, the claims are so couched as to be wafer-thin–(@ 0:39 — 0:45) Notice: ” …So for example, it could be that eventhough poorer Americans have a smaller share of the their absolute income is higher (i.e. than it has been in the past cited as comparison, 1975-1997). It also “could be” that, tomorrow, the Republican congressional leadership assemble on the House floor to announce that they have been part of a greedy conspiracy with top Wall Street investment banks to defraud millions of middle-class Americans, to the benefit of the country’s wealthies, who, they confess, are their paymasters. That “could be” possible, but it isn’t very likely. Simply, it’s not, even by a long, long shot, the best available interpretation of present and past data.
So, Steve is engaged in what is called ‘lying with statistics.’ The data are selected with care to leave out what is most central and instructive. The years mentioned, and the slice of the income distribution, the top and bottom 20%, don’t offer us the really stupendous picture that we’d get from examining over a longer-time frame the top and bottom 1% to 5%. Moreover, the original argument, “One often-heard contemporary economic myth” is that the rich are getting richer and the poor are getting proorer. Like any myth, there is nugget of truth to this.” (0:04 –0:13) is first admitted–then quickly and conveniently left behind in a blurr of irrelevancies about “absolute condition of the poor”. What is that? It’s an abstraction into which he goes on to fit favored ideas, such as that, one can, while having suffered a falling share of the nation’s wealth, still enjoy a rising status relative to the same percentile’s past conditions. That is to say, though they possess both relatively and ain absolute figures, less of the national weakth, the poorest 20% may still be relatively “better off” than before.
By the same token, if a thug mugs you, beats you up and takes all your money, then gives you change to call an ambulance before leaving, your condition has improved, you’re relatively better off then you were before he left you with the change to call an ambulace. But, as to the issue of a fair society, you were wtill mugged.
Steve’s basic argument is that we shouldn’t focus on your being mugged. He wants us to take as mos significant the fact that the mugger left us with the change to call an ambulance. And, by the way, Steve’s political allies are bent on cutting down what is analogous to the “public ambulance services” to the minimum–leaving only a privately-run for-profit system–the kinds of substitutes which are available only to those who can afford to pay for the services.
re: “But that doesn’t mean you refuse to look at potential disconfirming evidence of your own biases on the grounds that it comes from politically motivated people.”
If the real case were that the facts clearly favored the argument offered bt Horowitz, he shouldn’t need to go to circus-lengths of contortion in order to assemble a seeming but misleadinly favorable-looking set of data.
Again, as I’ve argued above, people like him can do this stuff because the audience is simply so utterly defenseless, having neither the time, resources nor the reasoning skills to listen, analyze, doubt, investigate and pick apart a shoddy self-serving dog-and-pony show.
I too wondered why the statistics were dated.
What an analogy. Makes no logical sense, but whatever you need to do to push your opinion. I was looking for these other statistics that would show that they cherry picked data in your post, but it seems you are one of those people who has neither the time, resources, or reasoning skills to post any evidence to back up your claims. Gish gallop on into the sunset if you would please.
RE : “I was looking for these other statistics that would show that they cherry picked data in your post, but it seems you are one of those people who has neither the time, resources, or reasoning skills to post any evidence to back up your claims. ”
If so, then, in case you haven’t bothered to read that far, look at my post below:
@ proximity1 : March 10, 2013 at 1:53 pm
It provides links to a set of sources which contradict your Professor Horowitz’s stuff; with supporting data, arguments that stand up to scrutiny and sources, cited, which anyone who’s interested in them may find and read.
As for your, “Gish gallop on into the sunset if you would please,” no, that’s what you’re trying to get away with here.
correction:
to correct a composition error in the above citation, it ought to have read,
“So for example, it could be the case that eventhough poorer Americans have a smaller share of the national income, their absolute income is higher.”
( BTW: The WordPress text-reply software in use here has the frustrating tendency to skip and move off the cursor’s last typed position making typing commentary a needlessly arduous chore.)
reading references :
A GUIDE TO STATISTICS ON HISTORICAL TRENDS IN INCOME INEQUALITY
By Chad Stone, Danilo Trisi, and Arloc Sherman1
Click to access 11-28-11pov.pdf
———————————-
Exploring Income Inequality, Part 5: The Concentration of Income and Wealth
December 2, 2011 at 2:57 pm
http://www.offthechartsblog.org/exploring-income-inequality-part-5-the-concentration-of-income-and-wealth/
Posted by: Hannah Shaw
Posted in: Income Inequality, Poverty and Income, Trends
—————————————-
Thanks for the links.
–Santi
You’re welcome.
Most economists take the view that raising the minimum wage will depress employment among unskilled workers and those new to the workplace. There is a much smaller group of economists who take a contrary view, often those who work for labor organizations or have a clear liberal bias, such as Paul Krugman. If those who question some of the claims regarding global warming are science deniers and simpletons, what does that make those who challenge prevailing thinking on the minimum wage? Are they also simpletons?
“Most economists take the view that raising the minimum wage will depress employment among unskilled workers and those new to the workplace. ”
I think that among them we find liberals, conservatives, libertarians and some of just about every conceivable stripe and ideology. The divisions on opinion are more dependent on which priorities one takes. It’s not that liberal economists deny that minimum wage (MW) increases can have negative consequences for some employment, it’s that there are differences on when, where (i.e. which sectors, age-groups, types of employment, etc.) , why, how and how much the increase depresses hiring.
Depending on any economy’s various circumstances, the same minimum wage rise or fall could have a positive effect , a negative effect, or, indeed, no measurable effect on actual hiring. A lot depends on expectations—those of firms’ managers, those of wage-earners, and, of course, those of households as they estimate the near-term and mid-term prospects for their own financial conditions improving or degrading.
Wages also relate to such facors as mobility of job-seekers, their capacities to find and answer employment conditions and a host of other individual peculiarities that can influence decisions on the part of those seeking work and those deciding whether or not to hire new employees (or keep existing ones).
So you are saying that there are nuances, that reasonable people can disagree or least have different perspectives. That is my point with respect to global warming. I find it disconcerting that anyone who questions in any way liberal orthodoxy on this issue is dismissed as a bible thumping moron.
Yet another correction to make in the post of 10 March, @ 1 p.m.—
Where it reads,
“Watching the video carefully, one sees that the data cited, even if true, date from 1997. The year of the onset of the current lingering depression.”
The year ought to have been, of course, 2007, not 1997.
Piketty and Saez, too, have data that doesn’t extend into the present depression; they aren’t, however, arguing, either implicitly or explicitly that the picture has changed significantly for the better since the last year’s data, 1998, in their cited paper’s case. Nor do you find them arguing that the present or recent state of income distribution is something that can be rendered benign looking by such logical sleight of hand as that, in effect, a small piece of a growing pie is still better than an equal proportion of a smaller pie. The problem is that “the pie’s” proportional distribution worsened both relatively and in absolute terms. So, the implied purchasing power claim or some such idea that those who are most victimized by the worsening income distribution aren’t really worse off after all is just ridiculous, too.
What’s happened is that national wealth, distributed through the population, has been significantly more concentrated in the upper strata of the income scale. If the bottom 20%’s decline in share isn’t by itself so shocking, that is perhaps because the shift in income has come more at the expense of segments which are between the bottom 20% and the top 20%, and which, moreover, favor most a segment also not included in the selected data offered by S. Horowitz, the top 5% and up into the top 1%. Thus, the higher one goes on the income scale—in general—the more pronounced this concentration is. So, focusing on the “top 20%” and comparing it to the “bottom 20%” is going to avoid presenting the most dramatic shifts in income distribution. But, of course, that’s just an innocent coincidence, isn’t it?
How, though, does the picture look since 2007? For an idea, we have a paper by E. Saez of March, 2012: Striking it Richer:The Evolution of Top Incomes in the United States (Updated with 2009 and 2010 estimates) , Emmanuel Saez — March 2, 2012
What’s new for recent years?
Great Recession 2007-2009
(link : http://elsa.berkeley.edu/~saez/saez-UStopincomes-2010.pdf )
In it, you find, among other data,
This might, at first glance, appear to suggest that everyone, the richest included, have suffered in due proportion from the declines in income. But, that would be to suppose that it’s the same thing (or ‘worse’?! ) for a multi-millionaire or billionaire to suffer a 17.4% loss in annual income than for an average middle-class and poor family to lose 11.6% of its annual income. Tell me, please: in whose circumstances should you prefer to find yourself?
But, reading on, we have, on the other hand,
Notice, please, that since 2007, in particular, in 2010, “the top decile share in 2010 is equal to 46.3%, higher than in 2007. (emphasis added in all the above citation.)
That Horowitz neither included nor even mentioned this disconfirming data in the picture he presented must be another of those coincidences, right?
re: “That is my point with respect to global warming. I find it disconcerting that anyone who questions in any way liberal orthodoxy on this issue is dismissed as a bible thumping moron.”
I don’t see what the Global Warming issue has to do with this particular thread about inequalities of income distribution and their consequences–other than, of course, that people’s opinions vary on both, that these opinions are sometimes relatable to a commonly-found set of other issues, among them, beliefs about Global warming.
A person who disputes the validity of Global Warming Theories/phenomena (GWT) (as that is popularly understood) might or might not also be a Bible-toting fundamentalist; might or might not also have scientifically-based rationales for his rejection of GWT; might or might not also typically exhibit good, average or poor reasoning habits. Just because there may be reasonable grounds on which to differ about the issues of the influences of minimum wage policies doesn’t necessarily mean that all differences of opinion are similarly based on reasonable grounds. And, true, you didn’t claim that they are–but the implication is there —> “What’s true about motives for differences concerning MW policies is, therefore also true, or should be thought true, for motives for differences of opinion concerning GWT.”
That simply doesn’t follow.
concerning the assumptions behind
“No man is an island (right).” Your summary reads,
“The poor are poor because of culture. They don’t go to church at the same rates as the rich. They don’t stay married. These are the kinds of structural elements surrounding poverty that government can’t address.”
Whether that summary is a faithful representation of what the “Right-wing” (some significant part of that) actually believes is one question. My comments below aren’t directly addressed to that question because I take it for granted that some part of the Right-wing ideology does indeed reason in that way, however roughly that summary captures their views.
Instead, I want to examine for a moment what is contained in such views and why I think that they differ fundamentally from the counter-view, the “Left” version of “No man is an island”..
Under a general heading of “culture,” we have
As Premises:
They don’t go to church at the same rates as the rich
They don’t stay married
As Conclusion (by imputation (which I grant as accurate to some extent) to the Right’s views):
“These are the kinds of structural elements surrounding poverty that government can’t address.”
Church attendance and marriage–both of which share the common element of religious practice by the conventional conceptions of those terms–are also habits of social conformism and it seems that it is implied that there is something natural or inevitable about non-conformism’s “costs”—their entailing, among other things, higher probabities for poverty outcomes. That may be statistically an observable fact; but we might ask: why ought it to be a statistical fact? And, why, if the government chose to redress the consequences of such a cost for not conforming to these social (here, called “cultural”) customs, it couldn’t actually adopt policies which go some way toward achieving that end?
In other words, why are or why should these factors be allowed to impinge on a person’s or a family’s prospects for economic success? It would appear assumed that attending church or being married convey an income-earning advantage over those who are not married or who don’t attend church or who are neither. Why should that advantage, if real, be acceptable and tolerated any more than a person’s sex or “race” or age can, if permitted to, be taken into account in determinations of who is favored for employment and promotion and who isn’t?
In other words, if marriage or church attendance afford an advantage, that advantage is a socially-contrived one, not a feature of “nature’s plan” and, thus, why can’t and why shouldn’t “government address” this as a feature of improper discrimination in employment and promotion? If it were to do so, this supposed matter-of-fact aspect of cultural “reality” would be revealed for what it is: a human contrivance, and a morally questionable one for the same reason that other bases of discrimination have come to be veiwed as morally unacceptable.
Right? When placed under a bright light of examination, “cultural factors” for income inequality resolve into one or another form of blaming a victim for being victimized by prejudicial customs which aren’t defensible on any grounds of reasonable justice, but, rather, are found to operate by reason of social prejudice that is purely tribal in character.